Updated: Aug 12, 2021
Over the past 40 years, America's economy has become a Consumption and Investment Ponzi Scheme. The US Economy appears robust, resilient and the greatest wealth generator in the history of the world. However, it we look just one layer below the surface we will see:
Wealth transfer from the bottom 80% to the top 10% over past 40 years has been $50 Trillion resulting in the greatest wealth Transfer and inequality Gap in the History of the World
Almost complete destruction of organic economic fundamentals in the US economy, almost entirely driven by finance, destroying the underlying fundamental value of money in America, with interest rates at record low to negative values all over the globe, "FOR THE PAST 12 YEARS". Normally these emergency level interest rates last 6 months to a year, NOT 12 YEARS!!!!!!! Forecast suggest that this zero value of money approach will need to persist for the indefinite future?????????
US & global debt to GDP ratios especially in business private sector is far in excess of the record levels seen during the Global Credit Crisis and Great Recession. Corporate America and large investor wealth creation, lives on leveraged liquidity from the government (corporate welfare), to bid up asset prices that create wealth, separate from the supply and demand fundamentals of the real economy, making the real economy catastrophically too expensive to live in, for the bottom 80% of Americans, specifically so that the top 10% has the freedom and the power to create this wealth for themselves
Crazy catastrophically dirt low Velocity of money shows that the bulk of the money moving through out the economy is being passed back and forth between the wealthiest Top 10%, making excessive wealth for themselves at the expense and destruction of the bottom 80%..............that's 270 million American people
The cost of goods and services in the US economy, for the goods and services that Americans care most about - housing, healthcare, education, energy, transportation, insurance, retirement - are catastrophically too expensive for the bottom 80% of consumers on course to bankrupt America in the next 3 - 5 years if the status quo policies of Democrats and Republicans persist on a going forward basis.
In effect, the US Economy is no longer an Economy, it is really a financial system. It should be called a Finonomy. This is not a good thing. This is not a fundamental thing. This is a Consumption and Investment Ponzi Scheme, that has destroyed the value of money in the US economy. America fundamentally is a Fake Economy now, because it is not economic and has not been economic for 40 years, becoming less and less economic over each of the past 40 years, which explains precisely why interest rates are fundamental at or near zero relative to historical levels and are on course to attempt to go lower in the future, if the status quo policies of democrats and republicans persists on a going forward basis. Even though interest rates have been artificially held down over the last 40 years and especially over the past 12 years, to support uneconomic financing of the US economy, this situation is totally unsustainable. Interest rates near zero or negative, on a fundamental basis means that the economy's currency has no value. This fundamental has not been priced into the US and Global financial system. In the back of the global financial system's mind is the financial Point of View that the global financial system is just a year or two away from interest rates rising back close to historically normal levels and everything is going to all work out fine. That was suppose to happen 10 - 12 years ago, but it has never happened. Looking at US and global debt levels, the fundamentals are screaming that the financial system will never go back to fundamentally strong and healthy interest rate levels if the status quo market behavior of the past, continues on a going forward basis.
The mother of all financial collapses awaits the US and the World if we continue the status quo policies of the past 40 years from either the left or the right. Interest rates are already at rock bottom levels now. 3 - 5 more years of the status quo will result in sustained negative interest rates in the US and all over the world, with debt levels then potentially double where they are today, which are already at the highest levels ever in history. A global credit crisis and recession under those conditions, 3 - 5 years from now, would be catastrophic for the US and global economy, for the poor, the middle class, the rich and even the supper supper rich, no one will be spared.
This is serious. God, the Universe, whatever you want to call it is giving humankind one more chance to get this thing right. However, it is going to require that we come together as a family and work together to create an economy and society where the economy works best for everyone. Not just in words or in theory, but in deed addressing the overall economic fundamental problem in the economy, which when fixed, provides the foundation for transforming the US Finonomy back into a healthy and robust Economy that creates healthy and sustainable value added for all members of society and not just the wealthy and well connected. This is not an exercise in envy, hate or resentment of the wealthy and powerful. It is an exercise in saving the existence of the human race on this planet.
Covid-19 was/is a tragic illustration and reminder of what happens when a country does not have a well coordinated national strategy for dealing with a deadly virus that is attacking the country and the world. The United States of America, arguably the wealthiest, most powerful, most knowledgeable, most informed country on the planet, had the worst response to covid-19 on the planet in 2020, suffering more Americans killed, unnecessarily in less than one year, than all Americans killed in World War l, World War ll and the Vietnam War over more than twenty years. Other countries, with coordinated, national economic strategies led and coordinated by their central governments, had no to hardly any significant deaths associated with Covid-19 global pandemic. It makes a hell of a big difference. America spent more than any other country on the planet attempting to mitigate the impacts of Covid-19 because America did not do the simple fundamentals for preventing the spread of Covid-19. In less than a year, America had to spend nearly $8 Trillion to prevent its economy from collapsing, all because there was no national strategy and leadership of that strategy to direct Americans what we already knew has worked almost perfectly for centuries. Not only did America Spend $8 Trillion to prevent the economy from collapsing. The economy still fell in 2020, by 4.5% the most in more that 75 years, and hence represented another $8 Trillion loss in economic value resulting from America's failure to lead with a national strategy that America could have followed and benefited from.
I bring this up because the Infrastructure Program proposed by President Biden is a Whack A Mole approach to solving the 5 problem areas that have been identified above which drive all of the fundamental and environmental problems that America and the world are challenged with today and tomorrow. The democrats intentions are admirable, but they are proposing a solution that does not fix, the underlying brokenness and structural failures in the US economy. So the massive amounts of expenditure that they are proposing will quicken the financial collapse of the economy, because the infrastructure spending does not make the economy more economic, it makes it more dependent on an already near catastrophically sick and weak economy, to bear the weight of catastrophically more obligations that do nothing to make the economy fundamentally any stronger or any healthier.
The republicans approach is to do nothing, and just assume that the US Economy, really is still an economy that is perfectly allocating resources to the winners in the economy and society. If you are not winning, it is your fault, to bad, die and get out of the way, don't rob or steal our joy and success. Again, the current US economy is not an economy, it is a heavily unbalanced financial market about to explode. The incentives in the financial system are to ignore the fundamentals and massively support the winning few in the economy who are enjoying the excessively catastrophic level of benefits from the economy at the expense and destruction of the bottom 80%, over the next 3 - 5 years if the status quo persists.
Its actually a very good thing that the republicans are fighting the democrats over their proposed infrastructure program that is suppose to be a generational solution for turning the great ship of the American Economy in a fundamentally better structural direction that is best for everyone. I agree on the democrats goal, but I disagree with their solution to the symptoms.
America needs a National Economic Strategy Tailored to the 5 problem areas outlined above. A National Economic Strategy where you can fundamentally see how the different pieces are working together to create fundamental, sustainable value in the US economy that is consistent with what we as American value and what it fundamentally means to be Americans in America. A National Economic Strategy whose actions Radiate America, what it means to be Americans and drives economic fundamentals that make the US economy and society work best for everyone.
I have created this National Economic Strategy. It is called "The Economic Gospel for the United States of America (EG-USA). I also call it "Making it Right, The Economics of the 100%. I have thoroughly documented this National Economic Strategy on this website: LinK
America does not need Grandpa's post World War 2's infrastructure program. Biden's infrastructure program is not designed to make the US economy fundamentally economic, working best for all Americans. It is a shopping list that creates activity and catastrophically more financial obligations in the US economy, without making the US economy, healthier and better fundamentally working best for current and future generations of Americans. A national economic strategy is required to do that - The Economic Gospel for the United States of America is here!!!!!! Jump on Board America!!! We are ready to Go!!!!!!!!!! Go To: The Economic Gospel for the USA